Belief elicitation is important in many different fields of economic research. We show that how a researcher elicits such beliefs-in particular, whether the belief is about the participant's opponent, an unrelated other, or the population of others-affects the processes involved in the formation...

In choice under risk, differences between alternative states of the world render choice environments complex. Moreover, they entail powerful experiences of loss if satisfaction falls short of prospective states that did not materialize. An increase in complexity, i.e. a larger number of...

Motivated by recent research on survey data, we test the influence of the political regime on social norms under controlled laboratory conditions. Comparing solidarity behavior revealed by East and West Germans in 1995 and 2009, we find that East Germans persistently show much less solidarity...

Informed decisions are the cornerstone of a functioning democracy. The goal of this paper is twofold. First, to explore who is good at distinguishing between true and false, and, second, to learn something about mechanisms to debunk false news stories. In an experimental study, subjects were...

People do not only feel guilt from not living up to others expectations (Battigalli and Dufwenberg (2007)), but may also like to exceed them. We propose a model that generalizes the guilt aversion model to capture the possibility of positive surprises when making gifts. A model extension allows...

Learning that others earn more may reduce individual well-being but can also be informative about the own income prospects. This paper provides experimental evidence that separates direct effects of income comparisons on well-being and informational effects from observing changes in the income...

Economists tend to assume that agents maximize their expected utility. However, many different experiments have questioned expected utility maximization by showing that human behavior can be characterized as random. This paper proposes Thompson Sampling as a theory of human behavior across very...

We study belief updating about relative performance in an ego-relevant task. Manipulating beliefs about the ego-relevance of the task, we show that subjects update their beliefs about relative performance more optimistically as direct belief utility increases. This finding provides clean...

The psychology literature provides ample evidence that people have difficulties taking the perspective of less informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader...

This paper argues that stress tests encompassing the entire banking sector (macro stress tests) can be designed to improve welfare. We develop a multi-receiver framework of Bayesian persuasion to show that a banking supervisor can create value when he commits to disclose the stress-testing...